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Fair Value Measurements
 12 Months Ended
Dec. 31, 2025
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.
A description of the valuation methodologies used for the assets measured at fair value on a recurring basis, as well as the general classification of such assets pursuant to the fair value hierarchy, is set forth below.
Available-for-sale securities - Where quoted market prices are available in an active market, securities are classified within Level 1 of the valuation hierarchy. Level 1 securities would include highly liquid exchange traded equities and mutual funds. If quoted market prices are not available, then fair values are estimated by using pricing models or quoted prices of securities with similar characteristics. Level 2 securities include U.S. treasury and agency securities, mortgage-related agency securities, mortgage-related private label securities, obligations of states and political subdivisions and asset backed and other securities.
Loans held-for-sale - Mortgage loans originated and intended for sale in the secondary market are classified as mortgage loans held-for-sale and recorded at fair value. The changes in fair value of mortgage loans held-for-sale are measured and recorded as a component of mortgage banking services, net, in our consolidated statements of income and comprehensive income. Since estimated fair value is based on sale, exchange, or dealer market prices, these assets are classified within Level 2 of the valuation hierarchy.
Mortgage servicing rights - We estimate the fair value of our MSRs using a process that combines the use of a discounted cash flow model and analysis of current market data to arrive at an estimate of fair value. The cash flow assumptions and prepayment assumptions used in the model are based on various factors, with the key assumptions being mortgage prepayment speeds, discount rates, and cost to service. These assumptions are generated and applied based on collateral stratifications including product type, remittance type, geography, delinquency, and coupon dispersion. These assumptions require the use of judgment by management and can have a significant impact on the fair value of the MSRs. We use a third-party consulting firm to assist us with the valuation of MSRs. Because of the nature of the valuation inputs, we classify these valuations as Level 3 in the fair value disclosures. For further details on our level 3 inputs related to MSRs, see Note 4 - Mortgage Servicing Rights.
Derivative financial instruments:
Banking Activities - Interest rate swaps are valued based on quoted prices for similar assets in an active market with inputs that are observable. These instruments are a component of prepaid expenses and other assets and accrued expenses and other liabilities. The initial and subsequent changes in fair value of the interest rate swaps and the economic hedge derivatives are a component of other noninterest income.
Mortgage Banking Activities - The estimated fair value of forward mortgage sales of mortgage-backed securities and forward sale commitments are based on exchange prices or the dealer market price and are recorded as a component of prepaid expenses and other assets, mortgage loans held-for-sale, and/or accrued expenses and other liabilities on the consolidated balance sheet. The initial and subsequent changes in value on forward sales of mortgage-based securities and forward sale commitments are a component of gain on mortgage loans held-for-sale. The estimated fair value of IRLCs is based on the fair value of the related mortgage loans which is based on observable market data for similar loan product type. We adjust the outstanding IRLCs with prospective borrowers based on an expectation that it will be exercised, and the loan will be funded. The initial and subsequent changes in the value of IRLCs are a component of gain on mortgage loans held-for-sale.
Derivative financial instruments are classified within Level 2 of the valuation hierarchy.
The following table sets forth our assets and liabilities measured at fair value on a recurring basis as of December 31,:
Level 1Level 2Level 3
Quoted prices
in active
markets for
identical
assets		Significant
other
observable
inputs		Significant
unobservable
inputs		Total
Estimated
Fair
Value
2025
Available-for-sale securities$33,270 $435,700 $— $468,970 
Loans held-for-sale— 100,539 — 100,539 
Mortgage servicing rights— — 86,651 86,651 
Derivative financial instruments - assets— 22,384 — 22,384 
Derivative financial instruments - liabilities— (15,531)— (15,531)
Total$33,270 $543,092 $86,651 $663,013 
2024
Available-for-sale securities$31,730 $437,346 $— $469,076 
Loans held-for-sale— 61,825 — 61,825 
Mortgage servicing rights— — 84,258 84,258 
Derivative financial instruments - assets— 36,088 — 36,088 
Derivative financial instruments - liabilities— (22,863)— (22,863)
Total$31,730 $512,396 $84,258 $628,384 
There were no transfers between Level 2 and Level 3 during the years ended December 31, 2025 and 2024.
The following table presents a reconciliation for our Level 3 assets measured at fair value on a recurring basis as of and for the years ended December 31,:
202520242023
Balance, beginning of year$84,258 $76,701 $74,097 
Total fair value adjustments included in earnings(12,191)(4,714)(6,649)
Purchases, issuances, sales and settlements:
Issuances14,584 12,271 9,253 
Balance, end of year$86,651 $84,258 $76,701 
Certain assets and liabilities are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment). Assets and liabilities measured at fair value on a nonrecurring basis include the following:
Collateral dependent loans - Collateral dependent loans are financial assets. Loan impairment is reported when full payment under the loan terms is not expected. Fair value is generally based on recent third-party appraisals which are updated on a periodic basis. Loans are carried at the fair value of collateral, less cost to sell, if the loan is collateral dependent. A portion of the allowance for credit loss is allocated to the loans if the value of such loans is deemed to be less than the unpaid balance. If these allocations cause the allowance for credit loss to require an increase, such increase is reported as a component of the provision for credit losses. Credit losses are charged against the allowance for credit losses when management believes the uncollectibility of a loan is confirmed. When loans are partially charged off, the resulting valuation would be considered Level 3, consisting of appraisals of underlying collateral.
Other Real Estate Owned and Foreclosed Assets - Other real estate owned are non-financial assets and are valued at the time the property is acquired and initially recorded at fair value less costs to sell, establishing a new cost basis. Fair value is generally based on recent third-party real estate appraisals which are updated on a periodic basis. These appraisals may take a single valuation approach using the comparable sales method or use a combination of approaches including the income approach. Adjustments are routinely made by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are typically significant and result in a Level 3 classification of the inputs for determining fair value.
The following table sets forth our assets and liabilities that were measured at fair value on a non-recurring basis as of December 31,:
Level 3
20252024
Collateral dependent loans:
Commercial and industrial$6,783 $12,430 
Commercial real estate3,515 — 
Residential real estate1,875 1,255 
Public finance— 5,766 
Other— 2,232 
Total collateral dependent loans$12,173 $21,683 
Other real estate owned and foreclosed assets, net:
Commercial real estate$8,960 $2,911 
Residential real estate880 2,227 
Other1,674 — 
Total other real estate owned and foreclosed assets, net:$11,514 $5,138 
The fair value of other real estate owned and foreclosed assets in the table above utilizes the market approach valuation technique, with discount adjustments for differences between comparable sales.
Fair value of financial instruments not carried at fair value:
The carrying amounts and estimated fair values of financial instruments not carried at fair value are as follows as of December 31,:
Estimated Fair Value
Carrying
Value		TotalLevel 1Level 2Level 3
2025
Assets:
Cash and cash equivalents$652,592 $652,592 $652,592 $— $— 
Securities held-to-maturity33,839 29,446 — 29,446 — 
Loans (excluding collateral dependent loans)6,613,099 6,544,724 — — 6,544,724 
Restricted equity securities24,775 24,775 — 24,775 — 
Accrued interest receivable32,255 32,255 — 2,224 30,031 
Liabilities:
Deposits (excluding demand deposits)$4,645,527 $4,602,421 $3,315,648 $1,286,773 $— 
Securities sold under agreements to repurchase11,160 11,160 — 11,160 — 
FHLB advances— — — — — 
Subordinated debt, net36,680 35,981 — — 35,981 
Accrued interest payable6,680 6,680 — 6,680 — 
2024
Assets:
Cash and cash equivalents$615,917 $615,917 $615,917 $— $— 
Securities held-to-maturity35,242 29,563 — 29,563 — 
Loans (excluding collateral dependent loans)6,344,377 6,191,461 — — 6,191,461 
Restricted equity securities28,917 28,917 — 28,917 — 
Accrued interest receivable32,102 32,102 — 2,131 29,971 
Liabilities:
Deposits (excluding demand deposits)$4,445,237 $4,436,305 $2,879,662 $1,556,643 $— 
Securities sold under agreements to repurchase14,699 14,699 — 14,699 — 
FHLB advances135,000 135,000 — 135,000 — 
Subordinated debt, net75,841 73,326 — — 73,326 
Accrued interest payable8,705 8,705 — 8,705 —